Learn how Open Interest (OI), OI Change, and Volume influence market trends. Discover how AOC helps traders analyze market sentiment, support & resistance, and institutional strategies to make informed trading decisions.
Understanding Market Sentiment Through Open Interest (OI)
The financial markets are heavily influenced by big players such as FIIs (Foreign Institutional Investors), DIIs (Domestic Institutional Investors), and Hedge Funds. To track their positions, traders rely on Open Interest (OI)—a key indicator of market sentiment.
📌 What is Open Interest (OI)?
✅ OI represents the total number of open contracts at a particular strike price.
✅ Increasing OI → Indicates fresh positions are being created (either long or short).
✅ Decreasing OI → Suggests contracts are being squared off, reducing market participation.
📌 What is OI Change?
✅ OI Change reflects the daily increase or decrease in open contracts.
✅ For intraday traders, OI Change is more significant than total OI since it highlights real-time sentiment.
✅ A sharp rise in OI Change can indicate fresh buying or selling pressure.
Market Structure: How Support & Resistance Are Formed in Options
Unlike traditional price action-based support and resistance, option chain-based support & resistance is determined by the actions of Put Writers and Call Writers.
1️⃣ Support – Created by Put Writers
🔹 Why Do Put Writers Create Support?
📌 Put writers invest large capital, meaning they have a vested interest in defending a strike price.
📌 A strike with high put OI indicates that institutions expect the market to stay above this level.
📌 If the market approaches a high Put OI level, it often bounces back as institutions protect their positions.
🔹 How to Identify Strong Support?
✔ Maximum put OI at a strike price = Strong support level.
✔ OI Change confirmation → If OI Change is rising at a put strike, it signals that fresh support is being built.
✔ AOC Color Coding → Green-colored levels highlight strong support zones.
2️⃣ Resistance – Created by Call Writers
🔹 Why Do Call Writers Create Resistance?
📌 Institutions write calls at certain levels to prevent prices from rising beyond a certain point.
📌 When the market nears a high call OI level, it often faces resistance and pulls back.
🔹 How to Identify Strong Resistance?
✔ Maximum call OI at a strike price = Strong resistance level.
✔ OI Change confirmation → If OI Change rises at a call strike, institutions are increasing their short positions.
✔ AOC Color Coding → Red-colored levels highlight strong resistance zones.
🔹 Importance of Volume in AOC’s Option Chain Analysis
Volume = Total number of trades happening at a strike price.
- A high volume strike price acts as a magnet—market often moves towards high volume zones.
- However, if volume is too high, a reversal is possible because many traders are positioned there. Market do not feed the crowd.
🔹 Volume + OI = Stronger Market Signal
- If volume is high but OI is low → It’s speculative trading, not strong positioning.
- If volume is high and OI is high → Institutions are taking real positions, making the level strong.
Market Manipulation by Big Players (Institutions)
Institutions don’t trade like retail investors; instead, they use option writing strategies to control price movements and maximize profits.
🔸 How Big Players Move the Market Using Options?
✅ When the market rises, institutions write calls to create resistance.
✅ When the market falls, they write puts to establish support.
✅ This helps them keep the market within a controlled range while collecting option premiums.
🔸 Example of Market Manipulation:
📍 Assume the market is at 19,800, and institutional traders have written max puts at 19,700.
📍 If the market drops to 19,700, put writers will defend this level, pushing the price back up.
📍 This is why markets often bounce from high put OI levels, creating strong support.
💡 Key Insight for Traders
🚀 Many retail traders fall into traps by following price movements alone. However, without analyzing OI data, they miss the bigger picture.
✅ AOC’s advanced tools highlight institutional positions, helping traders:
✔ Avoid false breakouts & traps.
✔ Recognize where big players are positioned.
✔ Make data-driven decisions instead of guessing.
📌 Why Choose AOC for Option Chain Analysis?
✔ Real-Time OI Analysis – Track live market shifts to stay ahead.
✔ Color-Coded Support & Resistance – Green for support, Red for resistance.
✔ Graph-Based Insights – Visualize market trends with multi-OI graphs.
✔ Institutional Activity Tracking – Identify smart money movements.
✔ Mobile & Desktop Access – Trade anytime, anywhere with AOC.
🔹 Ready to take your trading to the next level? Explore AOC’s powerful features today! 🚀
🔹 Final Thoughts: Why AOC is a Game-Changer for Option Traders
AOC is not just an option chain tool—it’s a complete trading assistant for understanding market sentiment. It provides deep insights into OI movements, volume trends, and institutional positioning that traditional option chains fail to deliver.
💡 If you rely only on price action, you are missing 50% of the picture.
💡 AOC helps traders see the FULL picture by tracking institutional footprints.
📌 Ready to Level Up Your Trading?
Start using AOC today and gain an unfair advantage in options trading! 🚀
💡 Follow us for market insights & updates:
🌐 Website: niftychain.in
📱 Mobile App: Available on Android & iOS (Search for Advance Option Chain)
📢 Social Media: Facebook | Twitter | Telegram | YouTube
Other than that I (editor) have learned a lot from Gopal sir (if you are here I assume you know him) you can also check out his YouTube channel for learning AOC- AOCWaleSardarJi
📌 Disclaimer: Trading involves risk. This content is for educational purposes only and should not be considered financial advice.